SDLTM28400 - Reliefs: Alternative property
finance

Land sold to financial institution and re-sold to individual:
General overview FA03/S73

Where a financial institution purchases a property and re-sells
it to an individual, the individual borrows some or all of the
purchase price from the financial institution and grants a mortgage
to the financial institution over that property.

As two land transactions take place under these arrangements,
the combined effect of the reliefs is to bring the stamp duty land
tax payable on the purchase using these arrangements in line with
that payable on a purchase financed with a conventional mortgage
product.

The second transaction, the transfer from the financial
institution to the individual, carries full relief from stamp duty
land tax.

Relief is not available if the individual

enters into the arrangements, or holds the
lease or sublease, as a trustee and any beneficiary of the trust is
not an individual

enters into the arrangements, or holds the
lease or sublease, as partner and any of the other partners is not
an individual